How many cars can you buy and sell in a year before you have to get a dealer's license?

Question

I've bought 3 cars and sold one and am just curious!!

Answer 1

You can buy as many cars as you like, the dealer law only applies to selling vehicles. Each state is different. For example, Maryland has lowered the number to three, where it used to be five vehicles within a year that you could sell without a dealer license. This only applies to sales to non dealers, not trade ins.

Usually a standard of reasonableness will apply also. For example, if you buy a car in January, and sell it in November, after having it titled and tagged, and have driven it. This will not cause a problem. If there is a pattern of buying cars, titling them and quickly selling them without every tagging or using them, then it looks like you are acting like a dealer and will draw the attention of investigators.

Most states apply a standard of reasonableness. For example, a family (Mom, Dad, 4 kids) may have multible vehicles titled in one parent's name. There may be a car for each person to drive to work or school, a luxury or sports car that the parents have for special uses, a pickup truck for use around the home, and a motor home for travel. (assuming they can afford these vehicles)

If they replace 3 cars in a year, and rather than trading in the older ones they sell them privately, and then also decide to sell 0the motor home, replace it with a newer model, they would be in technical violation of the rule, but they would not have a problem. There is a reasonable explanation for their actions.

Answer 2

Varies from state to state. Typically 4 - 6. It's not how many you buy, but how many you sell that matters.

Answer 3

Wisconsin has no limit, that I know of. It quickly becomes an advantage to reduce tax and transfer fees.

Answer 4

check with your state but i think the standard is 10.